As I sit here at the Renaissance Center, GM's Corporate HQ, (No, I am not working on GM. I am here for the Final Four.), I am taking stock of Detroit and its desperate attempt to save an industry and in turn, save itself. And across my screen is news of the debt for equity swap that Ford has just accomplished. As a result, Ford will save $500,000,000 in interest every year. This swap is further detailed in this WSJ article.
Ford was said to have effectively purchased approximately $10 billion of debt for approximately 38 cents on the dollar. This will provide more breathing room for Ford as it tries to weather the slide in auto sales without requesting government aid.
No one know whether Ford can make this work without aid. But you have to give their leadership credit for the moves they are making. It should not go unnoticed that their CEO, Allan Mulally, is relatively new at Ford and an industry outsider. As I sit here at GM HQ, I wonder if the GM board is noticing where Mulally didn't come from.
Cheers, Mike
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Did it really snow in Detroit last night?? After seeing Detroit, I feel some empathy for Rick Wagoner but there needs to be a sharp leader to come into that city and into GM to turn that place around. Pittsburgh turned around when steel factories started closing. Both of the stadiums they built in Detroit are beautiful but who will sustain them in that area. Which brings me to a discussion about the NCAA. 72,000 tickets sold on SAturday at an average price of $200 is $14.4 million- ONE NIGHT-
ReplyDeleteWho sees the financial statement for that money?? It struck me as odd- a town in economic strife from poor leadership- where are our financial priorities
Even though Villanova did not advance to Monday's championship I still enjoyed myself this past weekend in Detroit at the Final Four. It was my first time back since spending six weeks there ten years ago and
ReplyDeleteyes, I had a great time. But that was a weekend.
What I found interesting was that when talking to the locals, many of the same problems, concerns regarding the city and its survival and revitalization still existed. It was as if the ten years never passed.
Hopefully this time the car manufacturers, city government, and the people all make the tough choices and turn the motor city into a success story.
stay adventurous,
Craig
Craig, welcome aboard! I found the locals very friendly and thankful people were showing up. I felt for the city. The whole situation is crying out for leadership with a broad prospective.
ReplyDeleteCheers, Mike
Anon, I assume the NCAA sees a big piece of the ticket money as does Detroit thru the Ford Field tickets. Detroit is very fortunate that Michigan State was in the final game. Every ticke was sold and there was no way it would have sold more than 40,000 tickets if State wasn't there.
ReplyDeleteThe city was alive all weekend and the pregame partying and dinners were packed. You should have been at Elwood's.
I was hoping State would win for Detroit's sake. But at least they got to the finals.
And yes Dorothy, it is all about leadership!
Cheers, Mike